Gas was the lowest since it had been in June of 2004 on mid-July reports the Energy Information. The combination of a soft economy and better fuel efficiency is contributing to a lower demand. Gas prices are going up because of the lower demand.
Drop in gasoline demand
Over 2008, the demand for both gasoline and oil dropped substantially. This drop in demand coincided with $ 4 a gallon or higher gas prices. This drop also coincided with increased interest in fuel-efficient and hybrid cars. By the end of 2009, more fuel efficient cars were being made but the demand went up. In the winter, more oil is needed for heating so the demand for oil is more than the demand for gas.
Production of U.S. oil
Oil production within the U.S. connects to gas prices. 28 percent of all oil requirements are supplied within the U.S. although that has changed just a little since offshore drilling is shut down. With so little of the oil used by the United States being produced domestically, the small rise in demand is requiring more imports.
Increase in summer driving
There has been a rise in oil demand because of summer vacations requiring more driving. As outlined by the Automobile Association, there will be further road trips taken by individuals this summer meaning more driving.
Fuel comparisons in the U.S.
The largest consumer of fuel is certainly the U.S.. China is the second-largest consumer of gasoline, but demand in China is quickly rising to levels that could make it first. There are heavy taxes in European countries on gasoline meaning gas can costs $ 8 per gallon in some places. Fuel efficient autos will probably become more popular with supply decreases.
